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1 INTRODUCTION The Social Security Administration (SSA) must rely on modern computer facilities in order to carry out its mission to administer equitably, effectively, and efficiently a national program of social insurance as prescribed by legislation. The SSA has a nationwide field network of more than 1,300 offices and 37 teleservice centers. Field operations are directed by the 10 regional commissioners and their staffs. The field installations are the main points of contact by the public with the SSA. They issue social security numbers (SSNs), help workers anti employers correct records of earnings, help claimants file applications for benefits and assemble the evidence necessary to prove their eligibility, adjudicate retirement and survivors insurance claims, help determine the amounts of benefits payable, forward disability insurance claims to cooperating state agencies (generally state vocational rehabilitation agencies) for determination of disability, and give workers and their families the information necessary for them to understand their rights and obligations uncler the program. In addition, the SSA headquarters, located in Baltimore, Maryland, consists of staff offices, the National Computer Center (NCC), disability operations, central records maintenance, and foreign claims operations. The SSA also operates data operations centers at Wilkes-Barre, Pennsylvania; Albuquerque, New Mexico; and Salinas, California. The data operations centers do not perform data processing; their major function is to maintain earnings records and convert annual wage reports from source documents to electronic form for transmittal to the NCC. All data processing for SSA is done at the NCC. Six program service centers (PSCs) (located in New York, New York; Philadelphia, Pennsylvania; Birmingham, Alabama; Chicago, Illinois; Kansas City, Missouri; and Richmond, California) certify benefit payments to the U.S. Department of the Treasury's regional disbursing centers, maintain beneficiary records, review selected categories of claims, collect debts, and provide a wide range of other services to beneficiaries. The following illustrates the magnitude of the tasks performed by these operations: Over 35 million people are receiving retirement and disability benefits. Seven million new SSNs and 5 million changes are requested each year. Wage postings for 200 million people are made each year. 9

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10 Three million new claims and 120 million changes affecting retirement and survivors disability insurance are processed each year. One million new claims and 9 million changes for supplemental security income are processed each year. By the year 2000, the number of Americans over age 65 is expected to increase by 36 percent, and the number of people receiving retirement and disability benefits will reach 44 million with new claims projected to hit 5.6 million annually. Considering these factors it is not surprising that the SSA operates one of the largest recordkeeping systems in the world. Automated techniques must be used to perform the huge job of posting earnings to individual records and computing benefits from these records. The use of automatic data processing and telecommunications has been extended to practically all areas of program operations. Under the Systems Modernization Plan (SMP), the processing power of SSA's computer systems was increased eightfold and put to new uses. For example, the claims modernization project allows a claims process to be performed by field office staff by entering information directly into the system. It also allows field office staff to request any information in agency records needed to process a claim and provides a paper copy of the completed application for the claimant to sign. However, many functions and entire processes are still performed manually, and so the SSA has a great deal more to do in automation. The SMP was released in February 1982 by Commissioner John A. Svahn to correct the crisis state that the SSA's data processing operations faced, primarily the result of years of neglect. Originally, the SMP was formulated as a 5-year plan to modernize the SSA's information technologies and its management. However, in October 1986 the SMP was reissued by Commissioner Dorcas R. Hardy as a long-range strategy covering another 5-year period. The purpose of the reissued plan was to refocus emphasis from hardware acquisition to improving performance on software developments, which were progressing much slower than initially estimated. Responding to oversight suggestions, Commissioner Hardy also created the Office of Strategic Planning (OSP), which produced the Agency Strategic Plan (ASP) in January 1988. The purpose of the ASP is to establish the broad directions the SSA would adopt to serve the nation 10 to 15 years into the future. The ASP recommended 29 objectives in all that were aimed at simplifying programmatic functions, increasing customer service, applying technology, and improving the SSA's organization and management. With the introduction of the ASP, the SSA decided to complete the remaining active projects that were initiated under the SMP in 1990. At that time, the agency plans are to have transitioned fully to its ASP and the tactical and operational plans and projects that are to be developed based on the ASP. There have been considerably different views regarding the status, accomplishments, completion date, and eventual cost for modernizing the SSA's systems under the SMP. Given the SSA's substantial investment in modernization and the newly established strategic directions, the agency needed an independent assessment of whether these investments and strategies for the future were consistent and appropriate. In 198S, at the request of Commissioner Hardy, the Board on Telecommunications and Computer Applications of the National Research Council convened a committee to review the SMP, ASP, and the technical and technical management environment's in which these plans are and will be implemented. The resultant committee undertook a two-phase study. This is

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11 the committee's report at the conclusion of the first phase. In this first phase we reviewed and assessed the SMP' ASP, and the software engineering methods used at the SSA. In the upcoming second phase we will evaluate the technical and technical management environments at the SSA for modernizing its information systems along with the associated human resource development and planning activities. We approached our task in four ways: (1) we heard briefings on SSA operations, processes, information systems, and resources; (2) we visited specialized facilities and examined information systems in operation; (3) we studied relevant planning and technical documents; and (4) we interacted informally with selected SSA officials. Recognizing the time it would take us to prepare and release this report and the urgency of near-term decision making, Commissioner Hardy requested that we provide accelerated advice on the progress of the SMP' its achievements, and the agency's computer processing capacity requirements. In response to this request we issued a letter report to the commissioner dated April 3, 1989 (See Appendix D). In it we tabulated changes at the SSA since 1982 in several key areas and also compared the agency's automated data processing (ADP) investments with those of a private corporation. Our letter report also stressed the need to use technology as a means to reduce the agency's dependence on paper and advised a review of the computer center backup and recovery strategy and vulnerabilities. The next 3 chapters of this report deal, respectively, with our assessment of the past, the challenges of the present, and strategies for the future. In Chapter 2 we provide our assessment of the SMP and the software engineering methods being adopted by the agency that came out of the refocused SMP of 1986. Chapter 3 deals with what we believe are the most pressing information management challenges facing the agency today, and in Chapter 4 we provide our assessment of the ASP and the strategies that we believe the agency should adopt to guide its future information architecture. Appendixes A through E, respectively, give the committee's statement of work, briefings heard, a summary description of the various functions that the SSA performs, a copy of our letter report to Commissioner Hardy without attachments, and a glossary.

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